House price decline in May ranks as slowest in a year: CoreLogic

House price decline in May ranks as slowest in a year: CoreLogic
House price decline in May ranks as slowest in a year: CoreLogic

The house price decline continued to slow over the month of May after the surprise Coalition Government win in the middle of the month.

National house prices declined an average of 0.5% in May, driven by a 3.2% decline in Darwin, the only capital city market to reach double digit declines.

Sydney and Melbourne, the nation's two biggest markets, also continued their slowdown.

Sydney's houses declined 0.4%, while Melbourne's dropped 0.6%.

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House price decline in May ranks as slowest in a year: CoreLogic

It's the slowest decline in Sydney since house prices started declining back in September 2017 when there were only 0.3% declines.

CoreLogic head of research Tim Lawless said the improvement is primarily being driven by a slower rate of decline in Sydney and Melbourne where housing values were previously falling at the fastest rate of any capital city.

"Sydney (dwelling) values were 0.5% lower over the month while Melbourne (dwelling) values were 0.3% lower; the smallest decline in values across both cities since March last year.

“In other cities, where housing market conditions have generally been more resilient to a downturn, the trend is opposite.

Click here to enlarge.

House price decline in May ranks as slowest in a year: CoreLogic

Sydney's annual dwelling decline now sits at 10.7%, compared to Melbourne 9.9% decline.

It was back to back declines in Hobart where dwelling values dropped 0.4%, bringing their rolling quarterly rate of decline into negative territory for the first time since early 2016.

The slowing declines come on the eve of the next meeting of the RBA where there is wide-spread speculation that the official cash rate is going be cut to a historic low 1.25%.

It has sat at a record low 1.5% since the August 2016 meeting.

Since the federal election, Tim Lawless said, “we have seen a variety of outcomes and announcements that are likely to have a positive effect on housing market conditions.

“The federal election outcome has removed the uncertainty surrounding taxation reform which should see an improved level of confidence amongst home owners and prospective buyers, particularly investors.

“We now have some certainty around the initiatives announced in the federal budget, a consistent commission structure for mortgage brokers (who comprise around 60% of mortgage originations), and the eventual stimulus for first home buyers in the form of a federal government deposit guarantee, which although limited to 10,000 participants with at least a 5% deposit, will kick off in January next year.

 

 

 

 

Joel Robinson

Joel Robinson

Joel Robinson is a property journalist based in Sydney. Joel has been writing about the residential real estate market for the last five years, specializing in market trends and the economics and finance behind buying and selling real estate.

Tags: 
Price Decline Corelogic

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